November 02, 2017

Shame on Thomas Jefferson and Appalachian School of Law

I follow law school news pretty closely, especially when it comes to ABA actions with respect to bottom-feeder law schools, so it came as a great surprise to me learn from the TaxProf Blog this week that the ABA sent letters of noncompliance to Thomas Jefferson School of Law and Appalachian School of Law back on May 19, 2017. The letters state that the Accreditation Committee “concluded that the Law School is not in compliance with the following standards” and then listed Standard 301(a) (rigorous program of legal education that prepares students for admission to the bar), 501(a) and 501(b) (maintain sound admissions policies, don’t admit applicants who do not appear capable of completing law school and passing the bar) for both schools. In addition, Appalachian was cited for non-compliance with 502(d) (failing to maintain copies of admitted students official transcripts), and Thomas Jefferson was cited for noncompliance with 202 (a) and (b) for lack of sufficient financial resources and 309(b) for inadequate academic support.

Thomas Jefferson’s class of 2016 had a woeful 147/143/141 and 3.15/2.89/2.61 LSAT and UGPA profile and has had a sub 50% first-time bar pass rate in California continuously since 2013, including 31% on the July 2016 California bar, and 24% on the February 2017 bar.

Appalachian’s entering class credentials in 2016 were even more dismal, 147/143/140 and 3.10/2.79/2.60. Appalachian has had the lowest bar pass rate of Virginia’s eight law schools for several years. Their first-time pass rate on the Virginia bar pass rate in July 2013 was 59%, July 2014 – 40%, July 2015 – 63% and July 2016 - 33.33%, dead last each time. Their first-time pass rate improved dramatically on this summer’s Virginia bar to 76.92% - after the ABA letter was sent - but the numbers were so small (10 of 13 passed) that this achievement is unlikely to get the ABA off the school’s back.

Thus, the fact that the letters were sent, or that these schools were found to be non-compliant with standards is not surprising. In fact, I noted that these schools were out of compliance with ABA standards and specifically recommended that the ABA take action at Thomas Jefferson well before these letters were sent out. (See here and here.) Rather, what is surprising is that over five months have passed since the letters were sent and we are just learning about them now, thanks to Paul Caron. The letters state that they will be posted on the ABA’s website, and they are there, but they are not readily found. I could find no reference or link to either letter on the ABA Section of Legal Education and Admissions to the Bar website where the other Council’s actions are publicized.

For their part, Appalachian and Thomas Jefferson were apparently perfectly happy to keep the letters secret. I can find no evidence that either of these law schools publicly disclosed that they had received such a letter. (If any readers are aware of evidence to the contrary, please so indicate in the comments or let me know.) A Google search does not find a single reference to these letters or any finding of non-compliance by the ABA with respect to these schools before the last couple of days, and the letters are not mentioned on the school’s websites, which indicate that the schools are fully accredited by the ABA. In contrast, very similar letters of noncompliance sent to Florida Coastal School of Law and John Marshall Law School (Atlanta) on October 12, 2017, were immediately shared with the schools’ students. So, credit is due to FCSL’s Dean Scott DeVito and JM’s Dean Malcolm Morris for prompt disclosure. (Of course, for students in their IL year, or 2Ls who decided not to transfer over the summer, October is just about the worst time to find out that their law school is in deep trouble with the ABA, but the timing of the letter was out of the school’s control.)

I believe all law schools have a duty to notify students, current and prospective, that the school had been found in non-compliance. Clearly, the existence of the ABA's findings would have been a highly relevant consideration back in May for an admitted student considering matriculating at Thomas Jefferson or Appalachian this fall. Similarly, this information would have been an important piece of information for a current TJSL or Appalachian student trying to decide whether to transfer to another law school after their first year (or a Whittier 1L considering transferring to TJSL). Indeed, there is a strong argument to be made that failure to notify current and admitted students is a breach of the fiduciary duty owed to the students under Department of Education federal loan program guidelines. When the DOE pulled federal funding from Charlotte School of Law, the department stated that law schools have a fiduciary duty to inform current and prospective students of any relevant information that may affect the accreditation status of the school. A letter from the accrediting agency stating that the law school has been found to be out of compliance with core quality standards would seem to fall into that category, as such letters have historically been sent as a precursor to placing a law school on probation, and the ABA has repeatedly and recently placed other law schools on probation for noncompliance with the same standards. Even if there was no strict legal duty to report, I believe there was a moral duty. As an advocate for transparency in law school admissions and legal education more generally (I serve as the Chair of Law School Transparency’s National Advisory Council), I believe there is an ethical obligation to keep current and prospective students informed about facts that could have a significant impact on them. Even if the school’s accreditation status is not in immediate jeopardy, a letter of non-compliance with basic standards clearly affects the reputation of the law school, which, in turn, impacts the career prospects of the school’s graduates.

The ABA should amend its own standards to include a requirement that a school found out of compliance with standards must promptly inform current and prospective students. Until such a standard is adopted, law schools should voluntarily disclose. If a law school finds out in the spring or summer (or fall for schools with a spring start option) that they have been found out of compliance, the school should voluntarily offer to return seat or tuition deposits to admitted students that choose not to matriculate. Instead of choosing the ethical path of full disclosure, it seems that these law schools decided to adopt a strategy of trying to keep these findings secret, perhaps in hopes of convincing the ABA that their findings were inaccurate or that the school had voluntarily corrected its past deficiencies, or just to buy time. Although disappointing, it is perhaps not surprising that law schools which have engaged in unethical admission practices by admitting students with little or no prospects of success would also choose not to notify their students that the school had been found out of compliance with ABA Standards. The strategy seems to have paid off, at least for Appalachian, which has reported a significant increase in enrollment this fall, from 38 entering students last year to 69 this fall. How many of these 69 students would have gone elsewhere or perhaps not enrolled in law school at all, if Appalachian had timely informed them of the ABA's findings? (I have not been able to find any information about TJSL’s fall 2017 entering class, but TJSL likely benefitted from the closure of its close competitor Whittier Law School. If any readers have any information, please share it.) Of course, it is entirely possible that if Thomas Jefferson or Appalachian had shared the letter from the ABA with current and prospective students back in May, that the schools might have experienced an exodus of current students and that some admitted students might have opted out. This would have further exacerbated the schools’ perilous financial circumstances and might even have forced the schools to consider closure. But the possibility that an already struggling law school might fail is an insufficient reason to allow that school to keep critically important consumer information from its customers.

This is the latest example of law schools placing the interests of its employees above those of its students. Law schools must model ethical behavior to the future legal professionals that they are trying to educate. Appalachian and Thomas Jefferson school have failed miserably to do so. Shame on them.

Comments

David, You focus on the fiduciary duty of disclosure to Law Students who attend lower rated law schools. However, your solution of mandatory disclosure of all ABA findings of a school's non-compliance will bring more equality among all ABA law schools. For decades top-ranked law schools have avoided public pressure and student unrest by receiving "private censure" under ABA Rule of Procedure, Rule 16 (b)(4). Many of those private censure sanctions have involved issues regarding the quality of legal education and, therefore, involve important issues regarding students' quality of education. For instance, private censure has sometimes involved violations regarding the quality of clinical and experiential course offerings and the types of faculty appointments provided to such professors. During the decades in which CLEA and others published statistics demonstrating that many schools violated ABA standards, how many times have you read about the ABA's determination that schools were out of compliance with such standards? Are you recommending that the "private censure" rule be abrogated for all findings of ABA standards violations? Or is your argument that a "private censure" does not limit the fiduciary responsibility to notify students regarding deficiencies in a school's educational program?

A private censure is one possible sanction for non-compliance with standards under Rule 16 of the ABA Standards and Rules for the Approval of Law Schools. The determination of an appropriate sanction is separate and apart from the original determination of non-compliance under Rule 12 and notice under rule 14. What I am arguing is that a determination of non-compliance should be public. If the ABA later decides that a private censure is the most appropriate sanction from the list of available sanctions (see below), based on all the aggravating and mitigating factors, then that may be appropriate.

Rule 16(b) Sanctions may include any or all of the following:
(1) A monetarypayment;
(2) A requirement that the law school refund all or part of tuition or fees paid by students;
(3) Public censure;
(4) Private censure;
(5) Publication or distribution of an apology or corrective statement by the law school; (6) A prohibition against initiating new programs for a specific period;
(7) Probation for a specific period or until specific conditions are fulfilled; or
(8) Withdrawal of provisional or full approval.

Since I don't have any personal knowledge of when the ABA has issued a private censure and under what circumstances, I can't comment on whether I agree or disagree with any such actions. Generally speaking, I support the maximum amount of transparency in how the ABA carries out its accreditation function, so I would have a strong preference for a public censure if a censure is deemed to be an appropriate sanction.

An astute reader noted that the letters to Appalachian and Thomas Jefferson refer to a decision made by the AccreditationCommittee at its January 12-13, 2017 meeting, but the letters were not sent until May 19, 2017, over five months later. If anyone has any insight into why there would be such a long delay in the ABA sending out the letter of non-compliance, please share it.

In the face of Trump bigotry, Trump meanness, Trump stupidity, Trump ignorance, Trump mendacity, Trump lawlessness, and Congressional fecklessness as a check, ANY law school is a great public good for our Republic ("if we can keep it"). Us lawyers, no matter where we matriculated from conduct the everyday business of our democracy. We run the country from the traffic courts, drug courts, civil courts, administrative agencies and on down the line. Lawyers and judges provide another pillar of democratic fragmentation. I am proud of those lawyers who hang out at our major airports to help immigrants, no matte what law school they came from...

DSSLC is a perfect foil here: a clever provocateur, posing as an ignoramus. As he lifts his leg and sprinkles compulsively on nearly every thread - always leaving his stench and hoping someone will smell and react to it -- he never fails to disgust. Sy, Carswell, DSSLC whatever. Maybe he'll move on and piss all over some other blog at some point.

David, I have not taken a position on whether or not the ABA should have a "private censure" option. I was asking a different question: Is a law school's obligation to inform students under a fiduciary duty theory that the ABA has found a violation of standards regarding the educational program any different depending on whether or not the censure is "public" or "private". In other words, does the nature/form of the ABA censure of the law school modify the fiduciary duty to notify law student consumers about the violations regarding the educational program? The answer to this question does not require specific knowledge of past "private" sanctions issued by the ABA.

Here is the process as I understand it. First, the ABA finds that a school is in non-compliance. Then the ABA sends a letter to the school informing them of this and gives the school an opportunity to respond. Then, in light of the response, the ABA decides whether to impose any sanctions. What I am advocating is that the ABA's initial finding of non-compliance with standards (i.e. the contents of the letter sent to the school) should be made public. What is important to the students is to know, as early as possible, that there is a serious problem at the law school they are attending or considering attending. If the initial non-compliance is not made public, and the ABA later decides on a private censure, then the students may never know there was a problem at all. But if the initial non-compliance is made known, and the ABA later decides that the appropriate sanction is a private censure, I don't have a problem with that.

In terms of the school's fiduciary duty, I believe the school should notify students of any material finding of non-compliance, that is any finding which could potentially impact the accreditation of the school or seriously undermine the reputation of the school, which could impact the ability of students graduating from the school to find jobs. I can envision a minor technical violation of standards which would not rise to this level of materiality. For example, SUNY-Buffalo also received a letter from the ABA sent on May 19, 2017. They were found to be in non-compliance with Standard 502(d) regarding the requirement to have a student's official transcripts on file. They were also found to be in non-compliance with Standard 202 with respect to the requirement to have sufficient financial resources to keep the school operating. I would consider the first violation to be non-material, and the second to be material, requiring disclosure to the students.

Is there authority (i.e., judicial, regulatory, statutory, custom and practice) that holds, squarely, that a law school is a fiduciary to its students on matters of decisions to enroll?

I don't ask as a hostile question. I am all in favor of the disclosures that David advocates (and more, please). But, I'm just wondering if a law school is required to disregard its own interests, vis a vis potential applicants, in the way a fiduciary should?

As for those already enrolled, it would seem to me to be a question of materiality. If the "stock" of the law school may be adversely affected, must the law school tell those already "invested"? Knowing that the adverse opinion of the ABA may never become public seems to affect that materiality analysis, no?

anon-
If you look at the Denial of Recertification of the federal student loan program from the Department of Education to Charlotte School of Law, there is a good explanation of the school's fiduciary obligation as a participant in the federal student loan program. This responsibility includes a duty not to make substantial misrepresentations. Substantial misrepresentations include advertising oneself as being fully accredited, and therefore presumably in compliance with ABA Standards, when the school has been found to be out of compliance with core standards, including 301 and 501, which the DOE letter described as being "foundational to the educational enterprise."

DOE noted that Charlotte asked the ABA to keep its findings secret because public release of its noncompliance with ABA standards would discourage students from enrolling and encourage high-performing students to transfer. This proved that Charlotte considered the information to be material. In light of this recent precedent, it is particularly troubling that Thomas Jefferson and Appalachian chose not to disclose.

No doubt the info is material, and should be disclosed.
I do question, however, use the term "Fiduciary" for the reasons suggested above.

I think sometimes this term gets used to simply suggest a duty to disclose. There are lots of situations where there is a duty to disclose, but that doesn't mean necessarily that the legal basis is a fiduciary duty.

For example, does a law school have a "fiduciary duty" to the public, including possible applicants?

Again, I'm all in favor of shutting down the violators asap (and ALL of them, not just selecting a few heads to roll and allowing the others to slide). But, the standards should be fair, consistent, well founded, evenly applied and not based on arbitrary misuses of legal buzz words.

David, thanks for another great post! I think the issues of higher education finance and ethics are very tightly connected, and I wish more people were willing to ask the hard questions. Re: fiduciary duty, this is an area where nonprofit status really does matter. There is no question that the directors of a nonprofit institution have a fiduciary duty to serve the public benefit through the institution's mission. There's also no question that this duty is being breached in numerous instances. It's less clear that the institution has a fiduciary duty to the students themselves, though I would argue that such a duty should be implied. But regardless of how it is characterized, I believe that certain actions harmful to students (admitting students with no realistic chance of success, failing to disclose relevant information in order to protect cashflow to institutional leadership, adopting strategies to maximize loan payments to the school) would also be found to violate the board's fiduciary duty. It's a common argument these days that there's really "no difference" between for-profit and non-profit institutions, but I think this is an effect of problematic behavior by the non-profits, rather than a characterization of the law that governs them.

Perhaps then, however, you are putting too much on the non profit and too little on the for profits?

My point is this: think of a trustee as the model of a fiduciary. How far do you need to bend and stretch the rules to get to the conclusion that a law school owes a "fiduciary duty" to the public at large (or, e.g., applicants)?

The duty to disclose is a completely different legal concept.

Are legal concepts important when litigating legal issues? I think so. If anyone wants to WIN this debate in court and shut down the offenders, use of the proper legal concepts is important. Saying that a law school owes a "fiduciary duty" to the public, sadly, sounds like a dorm room discussion point, and won't win in court.

Of course, please cite the authority to the contrary, and I'll stand corrected.

"an institution and its officers must act with the highest standard of care and diligence in administering the Title IV programs and in accounting to the Secretary for the funds received. 34 C.F.R. §§ 668.82(a),(b).

From this broad and clearly correct point, the letter appears to then equate this duty with essentially a duty with respect to nearly every aspect of the law school's core conduct, especially with respect to suitability of the program to the job market, lest the law school violate its "fiduciary duty" to administer Title IV programs with the care and diligence of a fiduciary.

Is this letter authority that a law school violates a "fiduciary duty" every time it misrepresents a material fact to an applicant or student about the prospects for employment (perhaps, as the letter suggests or could be misread to suggest)?

If so, should the legal community revisit some of the statements that were posted on this site a few years ago, concerning the job market for new graduates that were to materialize this and next year? I seem to recall some very firm statements. Does anyone remember?

I agree with anon above; the focus on whether a law school is a fiduciary or not seems to be the wrong question, and there are plenty of situations where disclosure is obligated outside a fiduciary relationship.

E.g., ABA Standard 509a clearly states that "All information that a law school reports, publicizes, or distributes shall be complete, accurate and not misleading to a reasonable law school student or applicant. A law school shall use due diligence in obtaining and verifying such information."

It is hard to imagine a school fulfilling that standard while not disclosing the ABA letter. Certainly, any reference to a school's ABA accreditation in materials provided to students, or published on a website, will not be "complete."